what is the process for buying a foreclosed house?

Question

I was pre approved for a home loan (90,000) but regular homes don't come close to that in my state. i have to do 100% financing and zero money down. what are my options?

Answer 1

Without doing any work yourself, you have at least three choices:

1. contact a bank's loss mitigation person to see if they have any bank REOs (Real Estate Owned). These are properties that the bank foreclosed on and wasn't able to sell on the auction. Look over their list and do a drive by on the ones that seem interesting to you. Then submit an offer to the bank. They usually have an agent that they work with, so he/she can help you out.

2. Contact the people that have ads that say "we buy houses". Ask them if they have any houses around 80k that they are willing to sell. Just verify the comps on the property.

3. Get an agent that doesn't mind low balling listed homes in the MLS. You might find a motivated buyer who will take your offer.


Regards

Answer 2

Unless you are willing to take a gamble be a little leary of buying a forclosed home. While every city/state does have auctions to auction off properties owing back taxes or such and yes you sometimes can get a great deal, know what you are getting into first. Buying a forclosed home from a bank is pretty simple, buying a forclosed home from the county or so is a little different. You should know whether or not any liens are on the home (because you will become responsible for them). Also you will have to wait at least 90 days if not longer after purchasing before you can do anything to the home or move in and the previous owners have the right to come up with the money in that time and take the house back, therefore you just wasted your time and effort. Do alot of researching and asking questions and know exactly what your local area has to offer as far as different options of buying a home.

Answer 3

Foreclosed houses can be a great deal, however there are many seasoned investors who go to these actions all the time and really know the process and what they are getting into. They have the time and money to do what is needed and are OK with not getting the house if the owners come up with the money in the time allotted to them. They just put their money back into their accounts and go out and do it again.

I would not put myself in a financial situation which is shaky at best and downright disastrous at worse. Look for a manufactured home. They are more affordable and can be a stepping stone to something bigger and better on down the road. If you make the right decisions you can step up slowly and eventually find yourself sitting pretty. If you take too many risks when you do not have the financial position to do so you could ruin your financial status for years to come, which would set you back severely. I understand wanting something right now. But it really is in the best interests to work within a given budget and then allow equity and earnings to increase your situation. It would then be best to look for something closer to your dream home. Eventually you will find yourself in your dream home and not have to worry about losing everything. good luck to you and your family.